EU-Mercosur Free Trade Agreement Expected Before August

The president of the Brazil-Spain Trade Chamber (CCBE) Jose Gasset Loring expects the Southern Common Market (Mercosur) and the European Union (EU) sign a bilateral free trade agreement before August.

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"I am an optimist and I think it could be closed before August," Loring said and added that the EU-Mercosur Free Trade Agreement (EMFTA) could be signed before the European Commission's newest members in October.

The president also believes that this "historic" agreement between the two blocs would increase bilateral trade and investment flows, especially to Brazil, South America's largest economy.

According to the president of the CCBE president, an organization with more than 360 companies, Brazil could receive up to US$400 billion in foreign investments during the next 30 years if the deal, which took 23 years to negotiate, goes through.

Mercosur was established in 1991 and currently encompasses Argentina, Brazil, Paraguay and Uruguay. Its next summit will be held in Santa Fe, Argentina, in July.

Brazil's far-right President Jair Bolsonaro will meet Thursday with his colleague President Mauricio Macri in Argentina to discuss details of the deal between Mercosur and the E.U., among other issues.

Anticipating the Brazilian leader's arrival, Argentine unions and organizations are calling for massive protests Thursday in front of the Casa Rosada presidential palace in Buenos Aires.

"The people of Brazil have undergone adjustment policies, privatization and repression, which has grown in recent months," said a manifesto signed by the Argentine Workers' Central Union (CTA) and others.

Last January, just after Bolsonaro took office, he and Macri discussed the EMFTA, a trade bloc instrument that cannot be negotiated between individual members, according to its rules.

"Brazil is working with the Mercosur countries in an agreement with the EU; however, the European common market is very complex," said Bolsonaro's Chief of Staff, Onyx Lorenzoni, on March 26, adding that such agreement could provide more than US$60 billion in revenue for Brazil. 

During the campaign trail last year, Bolsonaro said he wanted to leave the pact and his Economic Minister Paulo Guedes criticized Mercosur in October calling it “too restrictive” and “not a priority” for the government.

This is Bolsonaro's first official visit to Argentina as president.